Reebok and Nike use market segmentation to sell to children

Sportslover and Betts and Betts are both specialist stores, promoting a high quality service and selling

a quality product, however they cater for different markets. Sportslover sells a large range of sports

shoes and backs up this market with other sporting goods. In comparison, Betts and Betts stocks a

large range of shoes, including a small range of sports shoes. There is no direct competition by brand

name only by price. Herein lies a threat to Sportslover. Likewise Big W competes with a lower price

range of sports shoes. Direct competition exists between business offering the same products, namely

Rowe and Jarman and Sportslover.

Sports lover

Bets and bets

BIG W

Marke

tBusiness

Product

Name

Shoe

type

Age

Grou

p

A Big W 14 Leisure 7 Sports 3-7

13 Runaways Sports 3-6

12 Dunlop Sports 3-12

11 Monster In

My

Pocket

Sports 3-6

10 Aerosport Sports 7-12

9 ProseriesBasketbal

l7-12

B.Betts and

Betts8 Prosport Sports 4-10

7 Frontrunners Sports 4-10

6 Aerosport Sports 7-12

5 Slazenger Sports 7-12

4 ConverseBasketbal

l7-12

C. Sportslover 3 Nike/Reebok Trainers 7-12

2 Nike/ReebokBasketbal

l7-12

1 Nike Air

Jordan

Basketbal

l7-12

Sportslover targets the upper income household, followed by Betts and Betts suiting most middle

income households and Big W services lower incomes.As specialist stores Sportslover and Betts and

Betts offer a more expensive product and justify this by providing better service than Big W. To

distinguish between Sportslover and Betts and Betts products/service the consumer behavior studied

at Sportslover indicates the purchase decision is driven by image and/or real product benefits.Betts

and Betts promotes and displays their product with a conservative approach versus Sportslover who

appeals to the customer with a sporty image lifestyle.

The market for children’s sports footwear is well served by businesses in the Shopping Complexes.

This allowed the two basic criteria, demographics and psychographics, to be more evident in the

market segmentation analysis.

The demographic factor, household income, is divided into three market segments; high, middle and

low. The product pricing of the three shops, Sportslover, Betts and Betts and Big W, match these three

market segments in that order.

Further study revealed the second criteria for segmentation, psychographics, in particular the two

types of lifestyles, image conscious and the conservative traditional, marketed by Sportslover and

Betts and Betts. If lifestyles of children are determined by their parents, then the real segmentation

remains demographic based, since a child is dependent on the household income.

Advertising by Nike and Reebok is being directed at the market through a variety of psychographic

channels. What drives the customer to buy? Is it price related? On a demographic bases, price

becomes a consideration for lower income households. However, the top priced sports shoes have

been marketed as a lifestyle of well known athletes. In particular, basketball which is the current

popular sport. Has this become a fashion industry? One look at basketball shoes indicates a trend to

produce an item with gadgetry and vibrant colours. Are there real benefits to this high priced product?

To the true sportsperson, there are. However, to the child there are no real evident benefits. How

many parents are concerned with ‘over-pronation’? Examine the new Nike Air Max ST leaflet and the

answer to real benefits is stated, ‘Extraordinary Cushioning for Extraordinary Needs.’

With the aid of opinion leaders like Michael Jordan and Magic Johnson, stars of the American

basketball, advertising portrays them as heros which children then aspire to. Should this advertising

raise the issue of ethics? Children are easily persuaded and advertising of this nature can be

dangerous. This form of advertising is taking advantage of a lucrative market! Children are constantly

growing and wear out footwear like it is going out of style. This has helped the top sports footwear

companies maintain product development and induced a fashionable market. Products last only six to

twelve months before they are altered or replaced.

In conclusion, the result of competition between Nike and Reebok has developed a new market.

Competition kindled the use of technology in footwear and basketball heros are used as its form of

promotion. Children are a target of this advertising and has created a change in consumer buying

behavior, specifically that of their parents.

“The role of children and teenagers in purchasing decisions is increasing throughout the world. In Asia,

young people are also more affluent than ever before. Companies like McDonalds, Nike, and Coca Cola

are taking advantage of this trend with campaigns designed specifically for younger consumers in

Asian nations.